Unions
The AFL-CIO In Moscow: The Cold War That Never Ends
by David Bacon

MOSCOW (6/23/95) -- In 1990 Soviet Premier Mikhail Gorbachev visited the U.S., and spoke at Stanford University. Amid 50 businessmen, clamoring for the attention of the Soviet leader, only one trade unionist was present - the executive secretary-treasurer of the California Labor Federation. Jack Henning, one of the most progressive labor leaders in the U.S., tried unsuccessfully to ask Gorbachev a prophetic question. He later wrote him, and posed the question again.

"We are concerned," Henning said, "that certain American corporations will seek to use the Soviet Union as a haven for their low-wage, long-hour conditions of employment at the expense of our workers. They will do this in the name of assisting the market economy proposals espoused in your country. We do not believe this is your intent, but we seek assurance that the new economic order of the USSR will not be so used." {California AFL-CIO News, August 10, 1990}

Henning never received a reply. Within a year Gorbachev was gone, and the Soviet Union itself was just a memory. But Henning's question still hangs in the air today, as the standard of living in Russia plunges, and U..S. and European companies invest in privatized enterprises, and seek to position themselves in the new Russian economy.

Henning's question goes to the heart of the foreign policy of the AFL-CIO. What is the purpose, it asks, of the international relationships between U.S. unions and unions around the world? Is it to combine with workers in other countries for mutual protection against the global activities of multinational corporations, or is it to defend U.S. foreign policy and continue fighting the cold war?

This year the AFL-CIO will see the first contested election for its top leadership positions in decades. As debate unfolds over the kinds of policies which new leaders believe should take the labor federation into the next century, perhaps no issue is as important as this - the creation of a global labor framework to confront the worldwide activity of transnational corporations. Companies move production and investment from country to country at the speed of a phone call, in search of weak unions and low wages. With important exceptions, unions have had a hard time meeting this challenge.

AFL-CIO policy and activity in Russia, although relatively unknown to most union members, is the clearest expression of the traditional values and purposes of the federation's international policy - one whose roots are deeply sunk in cold war politics. As members and leaders of the federation look for a new direction, they will have to examine this policy closely, and decide if it answers the question which Henning put to Gorbachev six years ago.

Soviet unions have been structured very differently from U.S. unions. They administered housing, hospitals, schools, vacations, childcare and pensions, and distributed many consumer goods, to workers in large enterprises. In return, they organized them to increase productivity. They did not play an antagonistic role towards management, and tended to ally workers with managers to lobby the government for greater resources for their enterprise. {David Mandel, Rabotyagi - Perestroika and After Viewed from Below, Monthly Review Press, 1994, pp. 7-14}

Lynn Williams, retired president of the United Steel Workers, says that "these unions didn't see themselves as collective bargaining agents, but as agents of production. Their collective bargaining agreements were not remotely like ours." {interview with the author, 7/5/95}

The changes in the last years of perestroika, and those which followed the dissolution of the Soviet Union, had an enormous impact on that system. Soviet Premier Mikhail Gorbachev dissolved the Communist Party. The old union federation, the All-Union Central Council of Trade Unions, was also dissolved when the Soviet Union was disbanded.

In Russia, a new national federation was created - the Federation of Independent Trade Unions of Russia (FNPR - Despite the use of the word independent in the FNPR name, these unions are referred to in this article as the official unions; the independent unions are those which started up outside the frameword of the official unions.) An umbrella organization for the new Confederation of Independent States was created, the General Confederation of Trade Unions (GCTU). {interview with Vasily Balog, head of the international department of the GCTU, June 28, 1995}

In the last years of the Soviet Union, groups of workers began to break away from the old unions, especially coal miners. The Soviet government had allowed coal mines to become old and inefficient, failing to invest in them despite their importance in its industrial system. Starting in 1989, miners in the main coal centers of Donbass, Kuzbass, Donetsk, Vorkuta and Karaganda organized strikes of hundreds of thousands of workers. The Independent Miners Union (NPG), was set up in their wake.

NPG membership grew to 50,000 out of a workforce of 800,000. It sparked the creation of other independent unions for air traffic controllers, airline pilots, and workers in different regions of the country. Membership in the independent unions, however, has never accounted for more than about 3% of the workforce.

Economic reforms instituted in the wake of the breakup of the Soviet Union have empoverished Russian workers. The International Monetary Fund recommended a series of conditions for western aid to the Russian economy. "They weren't even shock therapy," according to Alexander Buzgalin, an economist at Moscow State University. "We had shock, but no therapy...with poverty for 30% of the workers." {interview with the author, May 12, 1995}

One condition was freeing prices. In a year and a half, from January 1991 to May 1992, the monthly cost of living rose from about 200 rubles to 5000, and industrial production declined 40% . By 1994, pensions had fallen from 55-75% of wages to 22-25%, affecting over 36 million people. Seeing retirees selling personal possessions on the streets of Moscow or St. Petersburg has become like seeing homeless people on the streets of the U.S. {David Bacon, Political Tightrope for Yelsin, Pacific News Service, June 23, 1992}

The IMF insisted on budget reduction through cutting subsidies to industrial enterprises. As a result, in May of 1994 alone, more than 5000 enterprises shut down totally or partially, and one out of every four large or medium-sized enterprises stopped work for at least one shift. {Kirill Buketov, The Russian Trade Union Movement During the First Half of 1994, KAS-KOR Report on Russian Trade Unions, Moscow, 1994} Many enterprises could no longer afford to operate daycare centers, vacation camps or other benefits, or maintain minimal rents on apartments.

Russian workers face growing unemployment and non-payment of wages. By mid-1994, the average period of unemployment for workers losing jobs increased to six months. {author's interview with Buzgalin} For Russian workers, unemployment is especially frightening, since it was virtually non-existent under the old system. A social service network like that in the U.S., as frayed as it is here, has not been put into place in Russia.

IMF edicts have cut subsidies to enterprises for workers' wages, and often when one enterprises sends its goods to another, it is not paid. In the month of March, 1994, alone, workers in 36,000 Russian enterprises didn't receive their wages on time. {Buketov, the Russian Trade Union Movement}

The AFL-CIO set up a committee on perestroika in 1989. Assistant Secretary of State E. Freeman toured industrial regions of the Soviet Union, and, according to Russian journalist Kirill Buketov, U.S. intelligence agencies set up a project concentrating on the Russian workers' movement. {Kirill Buketov, Undeclared War: The AFL-CIO Versus the Russian Labor Movement, Moscow, 1995}

After the big miners' strike in 1989, strike leaders were invited to the U.S. and were given financial and material support. In June, 1990, Richard Wilson, director of programs for the Free Trade Union Institute, an arm of the AFL-CIO's international department, visited the Soviet Union, together with the secretary-treasurer of the United Mine Workers, John Banovic. Wilson went back six months later to attend a founding conference of the NPG. {interview with Richard Wilson, July 14, 1995} Their visit was followed a year later by a team of labor and management representatives from the UMW and the U.S. coal industry.

As a result of these visits, the FTUI sparked the creation of Partners in Economic Reform (PIER), bringing together the U.S. coal industry association, the UMWA, the U.S. government's Mine Safety Administration, the Russian coal ministry, and the independent coal miners' union, the NPG. Despite representing over 80% of the workforce, the official miners union, the Russian Union of Coal Industry Workers (PRUP) is not represented.

According to the FTUI, "this program is aimed at providing technical assistance and promoting U.S. investment in order to revitalize these coal regions, and to provide a model for other sectors of the Soviet economy in terms of adapting to a market economic system." In January, 1992, President Bush made the project part of a federal energy sector initiative for aid to Russia. {Assisting Democratic Trade Unions in the Former Soviet Union, Report of the Free Trade Union Institute, Washington DC, 1992}

The project is headed by ex-Labor Secretary Bill Usery. The U.S. National Mining Association is represented by General Rich Lawson and the retired president of the Peabody Coal Company, Robert Quenon, sits on the board along with CSX president John Snow. While cooperating in Russia, in 1992 Peabody spearheaded the coal companies who provoked a long and bitter strike with the UMWA in U.S. coalfields. Kirkland and UMWA President Rich Trumka also sit on the project's board of trustees. {interview with PIER spokesperson Neal DeLaurentis, July 14, 1995}

The coal project project has received $7.64 million from USAID since it began. {interview with USAID spokesperson Russell Porter, July 14, 1995} In November, 1994, the head of the Russian intelligence service appeared on television, and accused the project of advancing the commercial interests of U.S. corporations in gaining a favorable position in the Russian coal industry. {Buketov, The Undeclared War} The FTUI asserts that UMWA representatives are simply training NPG members in health and safety practices, and in ways of asserting their workplace rights. {interview with Richard Wilson}

The World Bank has recommended to the Russian government that it close unprofitable and inefficient mines to make the industry a more attractive investment prospect. A 1994 World Bank report has offered a possible loan of $5-600 million to restructure the industry, provided that as many as half the jobs in the industry are eliminated. PIER provides technical advice and logistical support to the World Bank team negotiating the terms of the loan. {interviews with Wilson and DeLaurentis} U.S. unions oppose such drastic cuts, but see some closures as inevitable.

After helping to bring Yeltsin to power, and becoming the backbone of the independent trade union movement, enormous job losses would be a bitter pill for Russian miners. Should the government adopt these recommendations, it would be doubly bitter, since the past head of the NPG, Victor Utkin, and its present leader, Sasha Sergeev, are both members of Yeltsin's council of advisors. {interview with Wilson} For U.S. and western European miners, large investments by foreign coal companies in more efficient Russian mines, combined with the comparatively low wages of Russian miners, might lead to the export of Russian coal and the displacement of U.S. and western European miners as well.

Following the formation of the coal project, the FTUI established an office in Moscow, in April, 1992. As its first project, the office organized the Russian American Foundation for Trade Union Research and Education. RAFTURE receives all of its funding from USAID, through grants administered by FTUI. Last year it spent $660,000. {interview with Wilson} The creation of the foundation was necessary, according to FTUI, because the independent unions "lacked a democratic national labor center through 1994, and generally acted separately." {FTUI, 1994 Annual Report}

The scale of the RAFTURE program dwarfs the activities which FTUI carries out throughout the rest of eastern Europe. Russian intellectuals run RAFTURE with worker advice, according to Wilson. "We had a lot of contact with Russian dissidents way before we had any [trade union] contacts over there," he explained. {interview with Wilson} But decisions about its activities are made by the Moscow FTUI office, which controls its funding. {interview with Leslie Deak, June 30, 19956}

RAFTURE administers a number of projects. It employs 20 organizers, whose responsibility is establishing new independent unions. Since over 85% of Russian workers belong to the official unions, the new unions are inevitably set up in workplaces where these other unions already exist. The project is designed to strip away members and bargaining rights from official unions.

The assignments given organizers - where to organize unions, in which enterprises, and among which groups of workers - are made by the AFL-CIO staff of the FTUI office, according to Leslie Deak, a U.S. trade unionist who worked there in 1993 and 1994. "A lot of the time, the decision is based on whether there is a union at home [the U.S.] which wants to work with an organizer," she says. {interview with Leslie Deak}

Representatives of the official unions say these alternative unions defend privatization in the interests of foreign companies. Victor Maleshko, St. Petersberg chairman of the official Communication Workers Union Of Russia, says that such unions were organized at Russian Telecom, the enterprise which runs the country's telephones. Three U.S. companies, including U.S. West, already hold a 35% stake in the enterprise. Last year, Yeltsin proposed allowing those companies to increase their stake to over 60%, a proposal which the old union fought with a one-day strike and eventually defeated. The alternative unions, Maleshko says, are in favor of privatization. {interview with Victor Maleshko, July 6, 1995}

Originally, Victor Utkin, past head of the NPG, was appointed to head the Organizers Project. In December, 1993, Utkin announced the formation of the short-lived Association of Free Trade Unions of Russia at a Moscow seminar, and was elected its chairperson. The largest independent union supported by FTUI, Sotsprof, then lost its organization in the Urals to a raid led by RAFTURE organizers. The head of Sotsprof, Sergei Khramov, then sent a letter to Paul Somogyi, executive director of FTUI in Washington DC, demanding Utkin's removal. {Buketov, The Undeclared War, p. 22}

Although FTUI's Wilson says that these problems have been resolved, Khramov's opinion of RAFTURE is negative: "It has to be said," he stated, "that the Russian part of RAFTURE is hindering the development of the free trade unions...The foundation provokes conflicts, and then parasitizes these situations." {Buketov, Undeclared War, p. 18}

Aleksandr Sereshnikov, who was employed by RAFTURE in its trade union education program, describes one incident at the Central Heating Plant in Novosibirsk: "An organizer comes to the factory and starts trying to tempt the workers: 'Set up a trade union, we'll give you a fax and a photo copier, and a regular financial sustainer.' Someone sets to work in that enthusiastically, enters into dispute with management, tries to discredit the FNPR union committee, and what's the result? Fights break out within the labor collective, the management takes advantage of this to weaken the existing trade union committee, and then the troublemakers are simply sacked. The new trade union isn't established, the old one is weakened, and the most militant workers are out on the street." {Buketov, Undeclared War, p. 23}

FTUI also funds the administrative staff of certain unions through its interns program. Ten people on the staff of SotsProf, and a like number on the staff of the NPG, are paid through the program. But funding positions is also a means of control, according to Sereshnikov. "Refusing a pile of greenbacks isn't so easy," he said. "This is how the Americans control them. If trade union leaders show independence, let's say in the question of calling a strike, the Americans can easily put them back in their place." {quoted in Buketov, Undeclared War, p. 21}

A newspaper, Delo, has been funded by the National Endowment for Democracy through FTUI since its inception. Last year it received $250,000. {interview with Wilson} Delo editorial policy is very supportive of the Yeltsin government, and is described by FTUI as advocating "social partnerships among labor, business and government." Its editor, Boris Batarchuk, was formerly an editor of the Communist Party journal "Problems of Peace and Socialism." {FTUI, 1994 Annual Report}

Delo constantly attacks the official unions. When they organize strikes and demonstrations against non-payment of wages or unemployment, Delo urges workers not to take part. {interviews with Buzgalin and Maleshko} Among many articles favoring privatization and neoliberal economic reforms, it published one called "How to Restore Order in Your House," by Pedro Daza Valenzuelo, head of the Chilean "Libertad" institute supported by General Augusto Pinochet. {Buketov, Undeclared War, p. 10}

When Yeltsin dissolved the elected Russian Parliament, and shelled the Parliament building, Delo immediately supported him. The FNPR condemned the action, and the government cut off telephone lines to its building. Pavel Kudyukin, RAFTURE's first chief and formerly deputy labor minister in the Russian government, condemned calls for the dissolution of the FNPR in an open letter, and was forced to resign from RAFTURE. {Buketov, Undeclared War, p. 33}

FTUI's report describes a RAFTURE program called a "Correspondents' Network of reporters in a dozen regions who send basic information to RAFTURE on developments in the workers' movement...RAFTURE draws on the Correspondents' Network, the clippings service, and other sources of information for its Database of Workers Organizations, an invaluable tool for keeping track of both the free labor movement, the official trade unions, and different anti-democratic union groups." {FTUI, 1994 Annual Report} Following Yeltsin's dissolution and shelling of the parliament, RAFTURE planned to use the network and database to build a new electoral and political force based in the independent unions, supporting Yegor Gaidar, architect of the shock therapy economic policies. {Buketov, The Undeclared War, p. 33}

Other RAFTURE-funded projects include four radio stations, which received $660,000 last year from USAID, passed through FTUI and the Glasnost Foundation. RAFTURE has television programs, a labor education program, a public relations department, and an advisory council of trade union leaders. The Rule of Law Program sets up Workers Rights Centers, which advise workers on ways to enforce their legal rights, and received $250,000 in a separate USAID grant. {interview with Wilson}

The FTUI reports on its activity in Moscow make no mention of the economic crisis faced by Russian workers, nor the increasing number of strikes and demonstrations organized in response to it. Yet that movement is growing, and the official unions are, in general, leading it.

In the spring of 1992, over 2.5 million workers in the Russian health care system struck for three weeks, to protest the fact that the Yeltsin government had only budgeted 40 percent of the actual cost of running the system. The strike was led by the 4.5 million member Russian Union of Medical Workers, affiliated to the FNPR. Its president, Mikhail Kuzmenko, declared that its purpose was "to secure the financing of medical institutions and ensure that health care protection of the population would have a budget that would rise with the cost of living." Most medical personnel hadn't been paid salaries at all for two months prior to the strike. {Bacon, Political Tightrope for Yeltsin}

In the first half of 1994, strikes were organized by the unions of communications and education workers, coal miners, pilots and shipyard workers. Other workers organized pickets and demonstrations, including unions of woodworkers, metalworkers, nuclear workers, and unions in the oil and gas, textile, machine, defense and fishing industries. Delo attacked coal miners who supported these actions.

Buketov notes that "in the past, the leadership of the FNPR called collective actions, but quickly curtailed them after failing to receive support from below. Now the FNPR coordinates actions organized through initiatives from the ranks." Individual actions by unions culminated in coordinated demonstrations in cities throughout the country on October 27, organized by the FNPR, over non-payment of wages. {Buketov, The Russian Trade Union Movement, p. 4}

On February 8 this year, coal miners again struck in a one-day national action, involving 500,000 workers in 189 mines and 21 open pits. According to Rajiv Tiwari, Moscow correspondent for the InterPress Service, "the official and independent trade unions of coal miners have buried their differences and for the first time joined hands in the strike." The strike demanded the payment of the government's 2.5 billion ruble debt to the coal industry, which led to non-payment of wages for the three months before the strike. {Rajiv Tiwari, InterPress Service, Moscow, February 8, 1995}

Finally, on April 12, over 500,000 workers demonstrated in various Russian cities, in a "day of all-Russian united collective trade union action," organized by FNPR. The national demands called for the payment of wages, and halting the growth of unemployment. In certain regions, the unions and workers involved also demanded new presidential elections, and changing the program of economic reforms. {Renfrey Clarke, Russian Union Day of Action Makes an Impact, Moscow, April 20 , 1995}

Despite the growth of worker protest over basic issues like the payment of wages, and growing cooperation on the ground between independent and official unons, at least among coal miners, the policy of the FTUI office is still to work only with the independents, and attack the official unions.

It's also the policy of the State Department, apparently. Mary Donovan, a business representative of the big New York City Musicians Union Local 802, travelled to Russia in 1992 as part of a union delegation, invited by the GCTU to conduct a seminar on collective bargaining, health and safety, and other areas of union activity. She reported her impressions to New York musicians in her union's newsletter, Allegro.

"I had heard a lot about the GCTU," she said, "including the fact that it was a former arm of the Communist Party and had used the KGB to suppress workers. Nevertheless, the federation still represents approximately 95% of the workforce in the republics of the former Soviet Union. Due to the changing economic situation, these workers are now confronted by many of the same problems that unions in this country face."

On the seminar's third day, Matthew Boyce, labor attache at the U.S. Embassy, showed up at the conference and announced that the U.S. participants were in violation of the AFL-CIO's non-contact policy. Donovan commented that "union representatives are apparently expected to register with the State Department even though U.S. businessmen - who were crawling all over Moscow and St. Petersburg - are exempt from this expectation." Boyce later wrote in the Wall St. Journal that he had kept tabs on the delegation throughout its 3-week stay. Donovan concluded her report by asserting "the cold war is over, and it is up to individuals - including trade unionists - to see that it stays over." {Mary Donovan, Union to Union in Moscow, Allegro, December, 1992}

Deak says that non-contact is still "a hard and fast rule. Those ex-official unions were completely irrelevant [to the FTUI office activity.]" she says. "We didn't even think about them or talk to them." In her view, the old unions run a spectrum from a small number she calls extremely corrupt, through a middle ground of unions which she says "just don't know how to change to become more representative unions," through a small number which have made that change.

The policy implemented by the office, of only supporting unions hostile to the FNPR federation, she believes "comes from the top down. This is Lane Kirkland's policy." But it's one which she increasingly questioned. "We've done a very poor job at fostering unity," she thinks. "The AFL-CIO has really enforced the fracturing of the movement there. They justify it by saying the official unions are corrupt, or don't represent people properly, but some unions in this country are too. I don't believe you can really see what's in the best interest of the Russian trade union movement, or Russia itself, if you're only talking to 3% of the workers. They have a highly-organized trade union movement. If your goal is to organize workers, you have to look at that." {interview with Leslie Deak}

The activity of the FTUI office, however, involves mobilizing political support for IMF-dictated economic reforms, and for the Yeltsin government which has been willing to implement them. These reforms create the conditions for multinational investment - the same conditions large corporations look for in any country - a low standard of living, weak and divided unions, and a political structure favoring investment over the needs of workers.

When Wilson was asked if he saw a basic conflict with privitization and U.S. investment generally, his answer was "No, of course not." Russian workers are desperate, he says. "They'll take whatever they can get [including] privatization, if it's serious, or investment, if it's serious." {interview with Wilson}

The question which Henning asked Gorbachev in 1990 is still in the center of the debate over the FTUI policy in Moscow. The World Bank loan to make coal mines more profitable highlights it, as does other investment by oil and communications companies, the prospect of mass unemployment, and a further breakdown of the safety net for workers generally. The activity of the FTUI Moscow office will ultimately be assessed by workers, both in the U.S. and Russia, based on how well it helps create a united and strong movement of workers to confront the situation Henning warned against.

Henning calls for global unionism to confront global capitalism. Retired Steel Workers President Lynn Williams sees the same goal. "My general sense is that there are lines to be drawn [between legitimate and illegitimate unions], but there's a compelling need to develop an international labor movement as quickly as possible. We can only do that by reaching out and working with people."

He expresses concern that the official unions in Russia still generally include management. In the eyes of militant trade unionists, the interests of management and workers are in basic conflict, and management domination makes unions illegitimate. Objecting to it is "not an unreasonable line to draw," he says, but also notes that "around the world, there are a variety of places where that line is drawn." The important thing, he says, is "that it's to our advantage to help build a labor movement which is genuine, independent, honestly-led, and which is committed to the cause of its own members, and the cause of the international labor movement."

That doesn't sound incompatible with the perspective of Vasily Balog, in charge of international affairs for the General Confederation of Trade Unions, the federation of official unions for all the former Soviet republics. "More and more," he says, "we're facing the same employers, and tackling the same problems of jobs, inflation, unemployment and the globalization of trade." He proposes that international union relationships be guided by the principles of "common understanding, mutual respect, tolerance, willingness to speak and listen to each other, and concern for what unites us rather than what divides us." {interview with Vasily Balog}